JDA Portfolio News for our Valued Clients
February 2002
Focus on Collaboration:
In This Issue:
1 Focus on Collaboration
How JDA is Leading the Industry
with its Collaboration Strategy
2 JDA FOCUS 2002
4 JDA Leads CPFR
with E3
6 Consulting Services
7 Vendor Managed
Inventory &
pro/sortment EIA
According to the 2001 Consumer Goods Technology (CGT) Trends
Research Report, the top two requirements for consumer goods companies is the pressure to reduce overall supply chain costs and the need to
collaborate more effectively with trading partners. Considering that collaboration didn’t rank on CGT’s report until 1999, collaborative initiatives
have skyrocketed in just a short time. In this issue of CUSTOMER FIRST,
Kevin Stadler, JDA’s senior vice president, collaborative solutions, discusses the JDA Portfolio™ solutions that can launch and drive our clients’
long-term collaborative business strategies.
8 Global Events
Calendar 2002
JDA Customer First provides our valued clients
with informative articles
on a particular industry
hot topic or innovation.
This edition is devoted to
collaboration, JDA’s definition of and our solutions
that support it.
JDA CUSTOMER FIRST IS
ALSO PUBLISHED
ELECTRONICALLY. TO
SUSCRIBE, EMAIL
CUSTOMER.FIRST@JDA.COM
.
How Does JDA Define
Collaboration?
Kevin: With the huge investment that retailers and suppliers have made in delivering
inventory to consumers, earlier
collaboration efforts have
focused on internal supply
chain efficiency. Our focus is on
any shared business process
throughout the demand chain
that improves sales, profits
and customer focus. We start
with the consumer and then
connect the business process
and data back up through the
supply chain.
Our goal is to leverage the
Internet to help manufacturers,
retailers and other partners to
work together to more accurately forecast, plan, execute and
measure consumer demand for
products and services. We also
Kevin Stadler, sr. vice president,
collaborative solutions
look at improving collaboration
in areas such as new store
openings, product launches,
promotional efforts, as well as
direct store delivery and in
stock position maintenance.
Who Has More to Gain: Retailers
or Suppliers?
Kevin: Both sides have much to
gain. The thrust of collaboration
is removing inventory costs
through a jointly managed supply chain that links demand
with supply. Suppliers can
continued on page 3...
Events
Register Today for JDA FOCUS™ 2002
JDA’s 12th Annual Conference & Partner
Showcase Poised to Deliver on its ROI Promise
Plan to be at the Mirage Resort & Casino in Las Vegas, Nevada from
Sunday, April 28 through Wednesday, May 1, 2002 for JDA FOCUS
2002. You’ll gain valuable information on proven strategies and programs for driving business optimization, partner collaboration and
customer service. Join your industry-leading peers and business partners as we address the challenges and opportunities that you must
act on today to prepare for tomorrow’s success.
Who Should Attend
JDA FOCUS 2002?
Whether your business is
Retail, Manufacturing,
Wholesale or Distribution, plan
to attend JDA FOCUS 2002.
This is the only conference that
successfully brings together
partners from both ends of the
global demand chain. Attend
visionary Keynote and Industry
Leader sessions on today’s hot
trends, get direction on up-andcoming technological innovations and participate in handson training on the latest JDA
Portfolio applications. Also join
our strategic business partners,
including FOCUS diamond
sponsors Symbol Technologies
and IBM, as they demonstrate
the latest innovations that can
extend the value of your JDA
solution and maximize your
technology investment.
Learn from One of the
World’s Most
Renowned Speakers
Join Roger Blackwell, Ohio
State University’s professor of
marketing and president of
Blackwell Associates, Inc. consulting firm, whom The New
York Times proclaimed as “one
of the top speakers on the lecture circuit and heralded as a
marketing and retail ‘guru.’”
Considered one of the founding
fathers of consumer behavior,
2
Mr. Blackwell co-authored one
of the fields’ leading books,
“Consumer Behavior.” Mr.
Blackwell is a 24-time published
author having also written
books on marketing strategy,
research and global marketing.
Take Advantage of
Discounted
Registration Fees
Register by March 15, 2002 for
a US$100 discount on registration fees:
• Clients on Maintenance:
US$995
• Clients not on Maintenance:
US$1,195
Register by March 15, 2002 for
additional group discounts:
• US$25/person for 6 - 10
attendees from same company
• US$50/person for 11 or more
attendees from same company
Enjoy Additional
Savings with a
Special Hotel Rate
For your convenience, we’ve
reserved a number of rooms at
Las Vegas’ beautiful Mirage
Resort & Casino at a special
room rate of US$152 per night.
Mirage Resort & Casino
Maximize Your FOCUS
Experience with JDA
University™
Attend JDA University’s “Basic
Intactix pro/space™” post-conference, two-day training session, where you’ll benefit from
hands-on education on the latest release of JDA’s state-ofthe-art, 32-bit space management solution. Attendees
should have a basic understanding of space planning.
Dates: Thursday, May 2 to
Friday, May 3 (9:00 a.m. to 4:30
p.m. each day). Enrollment fee:
US$1,000 per student.
Have Fun in “The
Entertainment Capital
of the World”
JDA FOCUS 2002 promises its
share of fun-filled events and
attractions for your enjoyment.
Enjoy “Las Vegas-style” evening
entertainment and practice your
gambling skills in JDA’s private,
non-monetary gaming room.
Also, tee off this year’s event
with JDA’s annual golf tournament on the Citation Course at
Stallion Mountain Country
Club, Sunday, April 28. Shotgun
start is at 7:30 a.m. Compete
in the Longest Drive, Longest
Putt and Closest to the Pin categories for prizes. Cost to participate is US$110 per person.
Register online today at www.jdafocus.com!
For more information, email info@jda.com,
call +1 (734) 887-4506 or visit www.jda.com/focus.
For more information, call your JDA contact, email info@jda.com or visit www.jda.com.
Cover Story
Focus on Collaboration: How JDA is Leading the Industry with its Collaboration Strategy ...
improve inventory positions and
fill rates, tighten production
cycles, decrease logistics costs
while streamlining delivery
strategies, and increase sales.
Retailers can increase turns
and profits through improved
item management, reduce lost
sales due to stock outs, drive
profits and improve customer
loyalty and retention.
tion, we can now address collaborative demand planning,
order forecast generation and
procurement — all the necessary
steps for improving inventory
visibility across the supply chain.
Kevin: Collaboration requires
an infrastructure that supports
the following three activities:
We also have more trading
pairs working from a single,
shared demand forecast. We’ve
already seen significant success in reducing out-of-stock
positions with lower overall
inventory. While CPFR has
rightfully generated much
excitement, we view CPFR as
just one initiative that the
industry can pursue.
1. A tactical business agrement
that defines the roles and
responsibilities of all parties
What are JDA’s Other
Collaboration Initiatives?
What Makes a Relationship
“Collaborative”?
2. Workflow management
3. Electronic exchange of data
Some collaborative processes
are less interactive and can be
managed with looser integration.
Other processes occur daily
and require tight integration of
workflow and business plan
along with frequent exchange
of data between the retailer
and supplier. Collaborative
Planning, Forecasting and
Replenishment® (CPFR®),
defined by the Voluntary
Interindustry Commerce
Standards (VICS) association,
is probably the best-developed
business process model that
follows these principles.
What Role has JDA Taken in
Launching CPFR Initiatives?
Kevin: JDA has taken a leadership position. We can deliver
the only complete VICS CPFRcompliant offering in the global
marketplace that supports the
high degree of business integration required among trading
partners. With our E3® acquisi-
Kevin: While we will continue
to deliver our current applications, we are also driving forward with the next phase in
collaboration: joint planning
and workflow solutions. Since
collaborative relationships must
be based on trust, we are developing detailed business process
maps that are shared by all
parties. These maps will represent the best practice processes
for each business flow based on
our work with over 4,000
clients in retail, manufacturing,
wholesale and distribution. By
basing the processes on established best practices, our users
won’t have to work from ground
zero to benefit from them.
The maps will illustrate
what party does which task(s)
and where they have to
exchange communications to
successfully accomplish a
given task. Each business
process will be assigned to
either a human or technology
source and automated alerts
through integration toolsets
will be employed. By its very
nature, workflow is customizable so individual users can
modify to address unique
requirements when necessary.
Describe the JDA Portfolio
Collaboration Framework™.
Kevin: Once you get beneath
the conceptual and workflow
layers of collaborative processes, you are faced with the hard
nuts and bolts efforts of trading data and integrating business process at a very real
data exchange level. Our new
Portfolio Collaboration
Framework provides the fundamental capabilities required for
supply chain collaboration at
this date and process level.
As delivered, the Internetbased JDA Portfolio
Collaboration Framework will
help our clients more tightly
couple business processes. It’s
an Extensible Markup Language
(XML) solution that will reduce
the cost and time to integrate
applications as well as business processes. By keeping
track of workflow tasks, trading partners will know exactly
what they need to meet their
compatible goals. For example,
space management and assortment management will work
seamlessly with inventory
management and replenishment functions.
I am confident that this
advanced integration solution
will revolutionize the collaborative exchange of data and
processes between retailers
and manufacturers so they can
increase operational efficiencies. These next generation
solutions will literally change
the way that companies work
together towards the all important consumer satisfaction.
For more information, call your JDA contact, email info@jda.com or visit www.jda.com.
3
CPFR
JDA Leads CPFR with E3
With the goal of enabling retailers and their suppliers to work from a shared demand forecast to improve
consumer satisfaction, JDA offers a comprehensive Collaborative Planning, Forecasting and Replenishment
(CPFR) solution. With our E3 applications serving as its cornerstone, our CPFR offering enables trading
partners around the world to efficiently synchronize demand with supply across product lines and distribution channels.
By providing clearer insight
into the future, we’re eliminating as much demand and
supply uncertainty as possible to do away with unexpected order spikes while assuring product availability on
reduced inventory levels.
Proven to be a Winner:
Ace Hardware &
Manco Win Best in
VICS Award
With more than 50 live trading
partners worldwide, JDA leads
the industry in deploying fully
operational CPFR relationships.
One of these collaborative relationships, Ace Hardware and
Manco Inc., was honored in
June 2001 by the prestigious
“BEST IN VICS Collaborative
Planning Forecasting and
Replenishment Implementation”
award. The Ace/Manco program
won top prize for advancing
from a VMI relationship to a
complete nine-step CPFR
process using E3 solutions.
Both sides have realized outstanding bottom line results:
• Manco’s distribution costs
decreased by 28% and freight
costs by 18%
• Ace Hardware increased sales
by 9% in a mature category
Our other manufacturing,
distribution and retail clients
have also reported tangible ROI
benefits including:
• Increased consumer
sales 8-30%
• Reduced inventories by
over 30%
• Reduced logistics and operational costs by 10-28%
• Reduced returns by over 20%
• Increased forecast accuracy
by over 10%
Just What is CPFR?
With such convincing benefits,
it’s no wonder that CPFR is the
hot initiative for 2002. Here’s a
simplified look at the concepts
behind the nine steps of CPFR
established by the Voluntary
Interindustry Commerce
Standards (VICS) committee:
1. Collaborative Planning:
Once partners agree to collaborate, they create a detailed joint
business plan that establishes
the relationship’s framework
and processes as well as outlines their compatible goals.
2. Collaborative Forecasting:
The partners exchange knowledge to create a single, shared
demand forecast. Partners consider different variables that
may affect demand for a cluster
of stores such as lag time from
order to fulfillment and the
process for generating orders
back to manufacturers. Once
they agree on raw demand, they
jointly commit to the forecast.
3. Collaborative Replenishment: The collaborative forecast
should automatically translate
into order execution. Here’s
when the retailer commits to
ordering and the manufacturer
commits to delivery. CPFR
extends the time horizon of
when orders are visible between
trading partners. Both sides
synchronize connecting the
order to the procurement system to purchase the product.
Lastly, the order is generated.
4
For more information, call your JDA contact, email info@jda.com or visit www.jda.com.
CPFR
To efficiently handle the volume of information exchanged in a
CPFR initiative, trading partners streamline their work through automated exception processing. Trading partners can concentrate their
review only on items that fall outside of pre-determined tolerances.
JDA Delivers A Total CPFR Solution
JDA’s CPFR offering starts
with Marketplace.com™, an
Internet portal that provides
secure access to our E3 collaborative solutions.
Marketplace enables trading
partners to reduce unnecessary buffer stock and lost
sales while optimizing production planning and product deployment.
Marketplace Replenish™ enables buyers and suppliers to collaboratively improve their businesses by jointly managing the demand forecasting and replenishment of retail stores and/or wholesale distribution centers. Collaborative scorecard functionality can be added to
ensure that trading partners are meeting and tracking their preestablished goals. At the heart of Marketplace Replenish is either of
JDA’s inventory optimization solutions: E3TRIM™ and/or E3SLIM™.
E3TRIM supports wholesalers, retailers and manufacturers
who hold finished goods in a distribution center (DC) or flowgoods through a DC. Using
detailed demand and
lead-time forecasts,
E3TRIM’s replenishment logic develops
ordering policies aimed
at maximizing profits.
New! Extended
Demand Chain
Visibility
Announcing JDA’s new CPFR
offering: the Electronic Dynamic
Agreement (eDA). eDA electronically converts collaborative
sales forecasts into order forecasts up to one year as
opposed to the traditional single
period. There is no other product like eDA on the market
today! Based on scientific algorithms, this revolutionary software translates demand projections into vendor order projections; empowering CPFR partners with greater knowledge
and long-term visibility into the
order creation process. Plus
eDA better supports the identification and resolution of exceptions to further smooth the
impact of demand shifts.
With visibility now extended
by weeks and even months,
partners can leapfrog their
competition by significantly
reducing safety stock, logistics
costs and lead-times required
for order fulfillment as well as
improving inventory productivity
and service levels.
E3SLIM meets unique store-level requirements for replenishment
and inventory functions, enabling companies to efficiently manage
over 100 million SKU/stores.
For more information, call your JDA contact, email info@jda.com or visit www.jda.com.
5
Services
Consulting Services Leading to Profitable Collaboration
You’ve read the benefits other companies have achieved by effectively collaborating with their trading partners.
And you know what your company could gain with collaborative processes in place. But where do you even
begin? Turn to JDA’s Consulting Services Group (CSG). Our consultants have the industry and system expertise to provide a full range of services intended to help streamline and strengthen processes to optimize efficiencies throughout your demand chain. Whether you’re a retailer, wholesaler, distributor or manufacturer, our
collaborative solutions will enable you and your trading partners to synchronize your businesses and take
resources out of your supply chain, while increasing sales and profits.
Streamline Processes
to Support
Collaboration
Our knowledgeable consultants will review and analyze
your existing business
processes, and that of your
key trading partners, to determine what processes are currently in place to support collaboration. By employing our
vast retail supply chain
expertise combined with our
best practice database, we’ll
recommend and implement
procedural and technological
enhancements within your
specific environment to
improve overall workflow
between you and your partners. With profitable practices
in place, our consultants will
help improve ROI at both ends
of your demand chain, providing you and your trading
partners a win/win solution.
Identify Relationships
that Achieve Bottom
Line Benefits
Not all partnerships provide
the same level of benefits. Let
our consultants help you
identify your optimal business
relationships in order to maximize sales and streamline
demand chain processes.
Once it’s determined how your
company manages its collaborative initiatives, we’ll review
6
your trading partners’
corresponding competencies. By applying a
proven methodical
approach, our consultants will identify
which partners best fit
your specific ROI
model. In other words,
we’ll determine which
partners most complement your business so
that you can optimize
inventory levels and expand
business opportunities. We’ll
even help identify key performance areas that require
improvement throughout your
demand chain, as well as recommend solutions, enabling
you and your trading partners
to maximize ROI.
Why JDA Consulting
Services?
Unlike any other global consulting organization, our consultants have researched best
practices of over 4,000 retail
supply chain companies
worldwide. We’re applying our
research findings to developing proven, best practice
business process maps, as
described by Kevin Stadler in
our cover story. Taking the
guesswork out of employing
effective processes, these customizable maps will provide
you and your trading part-
ners with specific guidelines
as to what tasks must be
completed, and at what point
communications must be
exchanged, in order to facilitate successful collaboration
in your specific environment.
Learn How You Can
Achieve Fast,
Quantifiable Results
With our consultants leading
your collaborative efforts, you
could see quantifiable results
in as little as three to six
months, with your entire
solution paying for itself in as
little as 35 days! To find out
how our consultants can help
you streamline your workflow
processes throughout your
demand chain, attend JDA
FOCUS 2002. We’ve dedicated
a track of approximately 13
sessions to collaboration and
how it can help optimize your
demand chain efficiencies.
For more information, call your JDA contact, email info@jda.com or visit www.jda.com.
Analytic
Vendor Managed Inventory: Cutting Inventory,
Boosting Customer Service with Arthur
To help our customers more
accurately respond to consumer demand, JDA offers
comprehensive solutions that
support myriad initiatives,
including Vendor Managed
Inventory (VMI).
A forerunner to today’s
Internet-enabled collaboration,
VMI has the supplier deciding
how and when to replenish its
retail customers’ inventory. VMI
enables suppliers to leverage
their deep product and market
knowledge to more efficiently
forecast and replenish on the
customer’s behalf. This helps
remove excess inventory from
the pipeline and synchronize
consumer demand with
production — while improving
forecasting accuracy and accelerating turns.
Long time JDA client, VF
Corporation, the world’s number one maker of jeans including Wrangler and Lee, is successfully employing a VMI initiative using Arthur Planning™
as part of its innovative solution. To maximize the power of
VMI, VF Corp. combines Arthur
Planning with internal solutions to create a dynamic
inventory model, or Retail Floor
Space Management program,
that generates maximum
income for the store space allocated. Sales planning, the program’s initial step, utilizes
Arthur Planning to create
shared sales-inventory plans
that mirror their retail customers’ businesses, rather than
VF Corp.’s internal perceptions
of the categories they oversee.
Retail partners such as J.C.
Penney are maximizing their
return on square footage by
ensuring their customers find
the correct sizes and colors in
the styles they want every time
they walk through the door. In
fact, J.C. Penney reported significant bottom-line improvements including “double digit”
sales increases, a 14% reduction in inventory and a 2%
increase in gross margins.
Collaborating for Optimized Product Assortments
With Efficient Item Assortment
contributing an estimated $4.1
billion in annual savings to the
U.S. grocery industry alone, it
is critical that retailers and
manufacturers collaboratively
and efficiently manage assortments at the shelf. In an effort
to streamline the labor-intensive process that enables
retailers and manufacturers to
create the most optimal product mix within a category management environment, JDA has
developed pro/sortment EIA™.
Part of the Intactix™ suite of
space management solutions,
pro/sortment EIA automates
The Food Marketing Institute’s
best practice, six-step EIA
process by taking into consideration consumer needs and
behaviors, category roles and
strategies, marketplace and
supply side conditions, as well
as financial considerations
when executing category plans.
As a result, retailers and manufacturers can collaborate to
produce top-line master
assortments that balance variety while eliminating out of
stocks for increased sales
and profitability.
Anheuser-Busch
Wins Technology
Leadership Award
Consumer Goods Technology
magazine recently awarded
Anheuser-Busch the Technology
Leadership Award 2001 for
actively collaborating with JDA
on the development of pro/sortment EIA, which automates the
best practice Efficient Item
Assortment process. The leading
consumer goods magazine presents the award annually to a
CPG company that demonstrates true innovation in its use
of information technology.
Commented
Steve Zielonko,
A-B’s senior
manager of retail
planning and category management, “pro/sortment EIA has been a huge success with our retail partners.
We’ve been very pleased with
JDA’s willingness to take input
from us and our retail partners,
and ultimately create such a powerful assortment planning tool.”
A-B is reaping compelling
results with pro/sortment including significantly reducing the time
and effort it takes to create storelevel product assortments from
eight hours of meticulous spreadsheet work to an automated 45second process. And by incorporating a retailer’s goals throughout the process, A-B is providing
objective analysis and high quality assortments that are driving
retail sales while improving the
overall shopper satisfaction of
the entire beer category.
7
For more information, call your JDA contact, email info@jda.com or visit www.jda.com.
7
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Global Solution Line
Phone Numbers
NORTH AMERICA
U.S./Canada
+1 (888) 441.1532
EUROPE
Belgium
Denmark
France
Germany
Ireland
Italy
Netherlands
United Kingdom
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JDA Global Events Calendar 2002
SHOW
LOCATION
JDA Canadian Retail Eye Opener*
JDA's Winning the Retail
Information Technology Race*
Toronto, Canada
Dubai, United Arab Emirates
EuroShop, JDA Stand 6/G72
IBF: Supply Chain
Forecasting Conference
Düsseldorf, Germany
Phoenix, AZ
Robertson Stephens
Technology Conference
San Francisco, CA
DATE
14 Feb.
17 Feb.
23 - 27 Feb.
25 - 26 Feb.
25 - 28 Feb.
JDA Serie Révelation du
Commerce de Détail 2002*
Montréal, Quebec
28 Feb.
Global Retail Technology Forum
4th International DIY BHB Congress
Paris, France
Frankfurt, Germany
9 - 11 Apr.
16 - 17 Apr.
NACStech
ECR Europe Conference
and Market Place
Dallas, TX
Barcelona, Spain
22 - 24 Apr.
22 - 24 Apr.
Retail Systems Forum
JDA FOCUS 2002, 12th Annual
Conference & Partner Showcase*
UK
Las Vegas, NV
Supermarket Industry Show
Chicago, IL
5 - 7 May
R.W. Baird “Growth Stock Conference” Chicago, IL
8 - 10 May
23 - 24 Apr.
28 Apr. - 1 May
Finance Directors Forum
Retail Solutions
Birmingham, UK
Birmingham, UK
19 - 21 May
21 - 23 May
Retail Council of Canada
IOLT Exhibition
Toronto, Canada
Birmingham, UK
3 - 4 Jun.
25 - 26 Jun.
Retail Systems
Chicago, IL
25 - 27 Jun.
* For more information on JDA-hosted events, call +1 (734) 887-4506 or email info@jda.com.
Copyright © 2002, JDA Software Group, Inc. All rights reserved. JDA, Intactix and E3 are Registered Trademarks of JDA
Software Group, Inc. Arthur Planning, Arthur, Marketplace.com, Marketplace Replenish, E3SLIM, E3TRIM, JDA FOCUS,
JDA Portfolio, JDA Portfolio Collaboration Framework and pro/sortment are Trademarks of JDA Software Group, Inc.
All other company and product names may be Trademarks, Registered. Trademarks or service marks of the companies
with which they are associated. JDA reserves the right at any time and without notice to change these materials or any of
the functions, features or specifications of any of the software described herein. JDA shall have no warranty obligation with
respect to these materials or the software described herein, except as approved in JDA's Software License Agreement with
an authorized licensee.